make sure that the forms encoding type is set to multipart/form-data image upload will not work if the forms encoding type is not set properly.
if you are still having problems, make sure that the page does not redirect to another opage after attempting the upload, then go to the bindings tab, expand the WA Uploaded Files Global status and bind the Debug info to the page. after trying an upload, this should give some information on what went wrong. Please post a URL so we can investigate the problem.